Background
Project Veritas reporters used false identities while investigating Democratic political consultants during the 2016 election. Allison Maass obtained an unpaid internship at Democracy Partners by posing as the niece of a purported donor. During her eight-day internship, she secretly recorded conversations and meetings, some involving nonpublic political strategy.
Project Veritas later published a video alleging a scheme to provoke violence at Republican events. Only about two minutes of the 16-minute video came from Maass’s recordings. After the video appeared, AFSCME ended contracts with entities associated with Democracy Partners founder Robert Creamer and withdrew funding from another organization that employed him. A jury found the defendants liable for fraudulent misrepresentation and violations of federal and D.C. wiretapping laws, awarding $120,000 for lost contracts and $10,000 in stipulated statutory damages. The district court denied the defendants’ renewed motion for judgment as a matter of law.
The Court’s Holding
The D.C. Circuit reversed. It held that the First Amendment barred the fraud damages award because the protected portions of the published video—not Maass’s unlawfully obtained infiltration footage—were the principal cause of the lost contracts. Under NAACP v. Claiborne Hardware Co., the plaintiffs had to show that the defendants’ unprotected conduct was the sole, pervasive, or dominant force behind their losses. Evidence that Maass’s infiltration was merely a contributing factor was insufficient. Because actual damages caused by the misrepresentation were an element of fraud under D.C. law, the fraud verdict could not stand.
The court also held that no reasonable jury could find Maass was a fiduciary of Democracy Partners. Her clerical duties and passive exposure to confidential information did not give her delegated authority to affect the firm’s legal rights or act on its behalf. Without a fiduciary relationship, the plaintiffs could not show that Maass recorded conversations for the tortious purpose of breaching a fiduciary duty, as required for liability under the invoked exceptions to federal and D.C. one-party-consent rules.
Key Takeaways
- Economic losses caused by reputational harm from a publication may trigger First Amendment protections even when the plaintiff pleads fraud rather than defamation.
- When protected expression and unlawful newsgathering both contribute to a loss, the plaintiff must show that the unlawful conduct was the dominant cause before recovering damages attributable to the combined harm.
- Access to confidential information does not by itself make an intern a fiduciary; the relationship must include authority or entrusted power to act for the principal.
Why It Matters
The decision limits efforts to recover publication-related losses through non-defamation torts when those losses predominantly result from constitutionally protected reporting. It also distinguishes liability for unlawful newsgathering from liability for the consequences of publishing material acquired lawfully.
For wiretapping claims premised on a recording made to commit a tort, the ruling underscores that the plaintiff must establish every element of the asserted underlying tort. Judge Wilkins agreed that the fraud damages award should be set aside but would have preserved fraud liability with nominal damages and upheld the wiretapping judgment.